User generated reviews have significant impact on buying behaviour

I just came across this ComScore press release which

“examined the impact of consumer-generated reviews on the price consumers were willing to pay for a service delivered offline. The study, based on a survey of more than 2,000 U.S. Internet users in October 2007, revealed that consumers were willing to pay at least 20 percent more for services receiving an “Excellent,” or 5-star, rating than for the same service receiving a “Good,” or 4-star, rating.”

According to the study “Nearly one out of every four Internet users (24 percent) reported using online reviews prior to paying for a service delivered offline. Of those who consulted an online review, 41 percent of restaurant reviewers subsequently visited a restaurant, while 40 percent of hotel reviewers subsequently stayed at a hotel.”

The study highlights certain types of service where reviews were most influential, but it also points out that more than three-quarters of review users in nearly every category reported that the review had a significant influence on their purchase.

The article concludes with a couple of meaningful quotes:

“These data show the importance of local service review sites in consumers’ purchase process,”
said Steve Marshall, research director for The Kelsey Group. “With such a large percentage of review users subsequently purchasing, it’s vital that local service providers have a positive presence on these review sites.”

“This study underscores the importance of providing not just good, but excellent, service if a business hopes to generate positive consumer reviews which will result in greater sales” said Brian Jurutka, senior director, comScore Marketing Solutions.